BOK to inject W3tr to counter Brexit-triggered instability

[THE INVESTOR] South Korea‘s central bank on June 27 said the bank will expand its liquidity supply this week to minimize the market uncertainties stemming from Britain’s recent vote to leave the European Union.

During an emergency meeting presided by Bank of Korea Gov. Lee Ju-yeol, the bank said it will inject short-term liquidity worth some 3 trillion won (US$2.63 billion) this week by deploying open market operations.

Such strategies are used to control the amount of money in the banking system. 

“In the case of South Korea, which is relatively more open, not only its financial market but also its real economy may be exposed to a negative impact from Brexit,“ Lee told BOK officials at the meeting.

However, he added that there is still no need for economic players to react too sensitively to short-term changes.

Shortly after Britain‘s vote Friday, the U.S. greenback shot up 2.52 percent against the South Korean won, closing at 1,179.90 won per dollar.

By Park Han-na (hnpark@heraldcorp.com)